A HELOC is the acronym for Home Equity Line of Credit, and thousands in the Seattle area have taken advantage of it. When the housing boom was in full swing a number of years ago, the values of personal homes gave their owners a strong resource to draw upon in the form of a loan. Unfortunately many of these loans amortized, leaving the borrowers with higher than predicted payments and long term loans.
Seniors 62 or older with a HELOC loan may be able to utilize a reverse mortgage to relieve the financial burden. The HECM, or Reverse Mortgage, provides the borrower with non-taxable income that will not affect social security or Medicare, and can be used for whatever the borrower sees fit. The funds from the loan can also be received in various options such as monthly payments or line of credit. Seeking the advice of a reputable reverse mortgage lender can help you make these decisions. During the application process, the HELOC will be discussed and a options of paying it off will be laid out.
If you do not presently have a HELOC but are considering one, put reverse mortgage on the table for a consideration as well. There will be advantages to both options giving you a sense of freedom to have choices.
Reverse mortgages are available to seniors from all walks of life, including married couples, and they will incur NO mortgage or loan payments. The amount of funds a borrower can receive is based primarily on two things – the amount of equity in the home and the age of the borrower. Although these are technically loans, they do not need to be paid back until the last borrower leaves the home permanently, at which time there are various options.
Janis Layman is a Reverse Mortgage Specialist serving the Seattle, Lynnwood, Edmonds, and Shoreline areas of Washington. Contact Janis and learn if reverse mortgage is right for you.